Anchoring

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Anchoring

The act of basing an investment decision on irrelevant information. For example, if one bases the value of a stock on its price a year ago, one is practicing anchoring. This can be a dangerous practice, but it is also easy to do. Anchoring is a concept in behavioral economics, which states that people often make decisions based on their perceptions and feelings in addition to (and sometimes instead of) facts.
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To maintain a balance while avoiding the anchoring effect, participants were presented with three situations: (a) the high price anchoring context, that is, "If a similar painting had sold at a price of 6 in the marketplace, how much are you willing to bid for this painting?
Slice method [1, 2] has the advantage of clear concepts, definite physical meaning, and rich experience, but limitation of the method is equally clear: due to the presumption that the potential sliding mass is considered as a rigid body, the anchoring effect of slice method is reflected on the structure of the shear resistance to the balance of force and torque, rather than the actual potential sliding soil mass deformation constraint or the inner force redistribution.
And that's to take advantage of the anchoring effect, the fact that your top price makes the cheaper prices look palatable.
Consistent with the fact that dealer valuations are somewhat higher for those with SSN below the median, there is what appears to be a negative anchoring effect associated with the soc + soc x dealer coefficient.
Rickford argues that in our excitement about the social and identity elements in sociolinguistic variation we easily forget the anchoring effect of linguistic structure.
74) These opinions dispute the empirical significance of the Guidelines' anchoring effect, arguing that in the career offender context the offender's prior crimes independently explain why he or she received a higher sentence.
Jodi Beggs tackles the topic of behavioral economics, using various episodes to demonstrate time inconsistency, narrow bracketing, reference-dependent utility, and the anchoring effect.
I find that it enhances it, suggesting the presence of a positive learning effect which dominates any potential anchoring effect.
In this article we assess the impact of the anchoring effect in bidding for online auctions.
As Kahneman's experiment demonstrated, the anchoring effect occurs even when the anchor is completely irrelevant to the decision at hand.
416-420) checked whether the anchoring effect can be observed in the German market.